An Economic and Agronomic Profile of Florida’sSod Industry in 2000

J.J. Haydu, L.N. Satterthwaite and J.L. Cisar

Economic Information Report EIR 02-6

Food & Resource Economics DepartmentAgricultural Experiment Stations andCooperative Extension Service

Institute of Food and Agricultural SciencesUniversity of Florida, Gainesville 32611July 2002

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An Economic and Agronomic Profile of Florida’sSod Industry in 2000

J.J. Haydu, L.N. Satterthwaite and J.L. Cisar

University of Florida, Institute of Food and Agricultural SciencesMid-Florida Research and Education Center, Apopka, FL

and Ft. Lauderdale Research and Education Center, Ft. Lauderdale, FL

ABSTRACT

Information is presented on production, employment, marketing, and product quality and price asa result of a survey of the Florida sod industry for the year 2000. Total sod production in Floridawas estimated to be 79,820 acres. Sixty-five percent of Florida sod acreage is St.Augustinegrass, 79 percent of which is Floratam, with Palmetto and Floralawn at 7 percent and6 percent, respectively. Bahiagrass comprised 23 percent of sod in production in 2000 andbermudagrass and centipedegrass were at 6 percent and 4 percent, respectively. Over two-thirds(70%) of Florida sod production occurs on sandy soils. The majority of sod production is insouth Florida. Harvested sod accounted for 67 percent of the sod in production and large-sizedfarms harvested the highest percentage of their production acres (75%). The in-field value for allvarieties totaled $438 million, while harvested sod was valued at $307 million. Levels ofmechanization and employment remained the same over the last four years for the majority ofsod farms. The survey showed that 97 percent of all producers expect to maintain or increasecurrent sod production, indicating optimism about future demand.

KEY WORDS: sod production, harvested sod, farm size, mechanization, farm income, farmexpenses, marketing, shipping

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TABLE OF CONTENTS

ABSTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

METHODOLOGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

RESULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Acres Grown and Harvested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Sod Prices, Industry Value, Price Determination, and Costs of Production . . . . . . . . . . . . . 10Components of Farm Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Harvesting and Brokering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15Shipping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Sod Quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Employment, Mechanization and Farm Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20Firm and Industry Problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

REFERENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

LIST OF TABLES

Table 1. Number of respondents to the Sod Survey – 2000, the production acreage reported ineach group and expansion factors used to determine ‘real’ numbers. . . . . . . . . . . . . . . 3

Table 2. Total expanded acres of sod grown in Florida in the year 2000 — by farm size (small:0–499; medium: 500–999; large: 1,000–1,999; very large: $2,000), soil type (sand vs.muck vs. clay) and grass variety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Table 3. Acres of sod harvested in Florida in 2000, by farm size and grass variety. . . . . . . . . . . 7Table 4. Acres of sod planted and harvested in 2000, by farm size and per farm, and ratio of sod

harvested to sod planted. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Table 5. St. Augustinegrass production in 2000, presented by farm size and grass varieties. . . . 9Table 6. Sod farm acreage, percent harvested, price per square foot, and unweighted harvest

value in Florida in 2000 — by major grass variety. . . . . . . . . . . . . . . . . . . . . . . . . . . 10Table 7. Full-time, part-time and seasonal employment figures for various-sized sod farms in

2000 and changes in employment numbers compared to four years ago. . . . . . . . . . . 21Table 8. Changes in mechanization on various-sized sod farms in 2000 compared to four years

earlier. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Table 9. Changes in operating expenses of various-sized sod farms in 2000 compared to four

years earlier. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

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LIST OF FIGURES

Figure 1. Types of grasses grown in Florida — shown as a percent of total production . . . . . . 4Figure 2. Reported acres of sod production in various regions in Florida in 2000 . . . . . . . . . . . 6Figure 3. Top four St. Augustinegrass types grown in Florida in 2000 — shown as a percent of

total St. Augustinegrass production. Other includes Raleigh, a mix of otherunspecified grass types, and Delmar — in descending order of acres in production . . 9

Figure 4. Percentage of total costs per acre attributable to specific sod growing and sellingactivities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Figure 5. Sod mower with a 36-foot swath. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Figure 6. Sod harvester cutting rolls for landscape use. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Figure 7. Considerations made by Florida sod producers when determining the selling price of

sod . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Figure 8. Partitioning of farm income by Florida sod producers in 2000 . . . . . . . . . . . . . . . . . 15Figure 9. Seasonal harvesting pattern of Florida sod in 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . 16Figure 10. Sod pieces stacked on a pallet consisting of 500 square feet. Sod pallet being picked

up to load on a truck. A truck loaded with sod ready for shipping. . . . . . . . . . . . . . 17Figure 11. Distribution of sod sales throughout Florida and the average percent of their total

sales for all growers who sell sod in specific regions . . . . . . . . . . . . . . . . . . . . . . . . 18Figure 12. Depiction of how Florida sod was utilized (left) and to whom sod producers sold their

product (right) in 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Figure 13. Weighted responses of survey participants when asked about the three most important

problems faced by the respondent’s business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Figure 14. Weighted responses of survey participants when asked about the three most important

problems facing the sod industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

1 Professor and Extension Economist, and 2 Senior Statistician, respectively, Mid-Florida Research and EducationCenter, Apopka, FL, 2725 Binion Road, Apopka, FL 32703-8504, tel (407) 884-2034, fax (407) 814-6186 , email

jjh@mail.ifas.ufl.edu.3 Professor, Ft. Lauderdale Research and Education Center, tel (954) 475-8990, fax (954) 475-4125, email

jlci@gnv.ifas.ufl.edu.

An Economic and Agronomic Profile

of Florida’s Sod Industry in 2000

J.J. Haydu1, L.N. Satterthwaite2 and J.L. Cisar3

INTRODUCTION

Florida is the fourth most populous state with 15.8 million people in 2000 and has a growthrate of nearly 2.3 percent annually (2000 Florida Statistical Abstract). Due, in part, to these twofactors, sod has become an increasingly important component of Florida’s urban landscapes. However, the same warm weather that has drawn people to Florida is also both a boon and a baneto turfgrass management — creating ideal conditions for vigorous sod growth, but also providingan environment conducive to the proliferation of pests and diseases. The affinity homeownershave for green lawns, combined with the need for high-level maintenance, has resulted in a verylarge, robust and economically important turfgrass industry. Results of a comprehensiveeconomic impact study conducted in 1992 (Hodges et al., 1994) underscored the diversity andmagnitude of the industry. The total turfgrass area used and maintained in Florida in 1992 wasabout 4 million acres with 75 percent of this area in the residential (household) sector. Turfgrassindustry employment was 185 thousand full-time and part-time workers or 130 thousand full-time equivalents. Water used for turfgrass irrigation in the commercial sectors was about 1.8billion gallons per day with 58 percent from groundwater sources. Consumers spent $5 billionon turfgrass maintenance or about $1,200 per acre. Sales of turfgrass products and services byproducers and commercial distributors totaled $6.5 billion with $2.1 billion in cash expenses forpurchased items. Turf-related (non-land) assets in equipment, irrigation installations andbuildings had a book value of $8.6 billion. Value-added to Florida's economy by all sectors ofthe turfgrass industry totaled $7.3 billion with golf courses contributing 35 percent, and servicevendors and households contributing 21 percent each.

Market demand is another approach to gauging economic importance. Demand for sod canbe roughly estimated by examining the number of new housing starts. The University ofFlorida’s Bureau of Economic and Business Research (BEBR, 2001) estimated 108.2 thousandsingle family housing starts and 48.9 thousand multi-family housing starts in 2000. Assuming0.33 acres per household (which includes both individual lot and “common areas”) for singlefamily units, this figure translates into 35,706 acres of sod required annually for this market.Assuming half the acreage (0.165) for multi-family housing units (including common areas), thisequates to 8,069 acres, for a total of 43,775. An additional 25 percent of sod not included in thiscalculation is targeted for other outlets, including golf courses, commercial and non-profitinstitutions, and the re-sodding market for existing homes (Figure 12 of this report), making totalannual demand in 2000 of 54,719 acres statewide.

In late 2001, another University of Florida survey on sod production and marketing wascompleted. The purpose of this study was to provide sod businesses, allied firms, industryleaders, university researchers and specialists, and state policy makers with current agronomic

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and economic information on this important agricultural sector. This report begins with adiscussion of the methodology employed in the survey and then examines research findings inthe areas of production, employment, marketing, product quality/price information and perceivedfirm- and industry-level problems.

METHODOLOGY

The sample for the

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Table 1. Number of respondents to the Sod Survey – 2000, the production acreage reported ineach group and expansion factors used to determine ‘real’ numbers.

Farm size (acres)Acreagereported

Number ofrespondents

Assumed numberof farm size

Expansionfactor

Small (1–499) 7,204 33 78 2.36

Medium (500–999) 7,543 12 25 2.08

Large (1000–1999) 12,182 8 15 1.88

Very large ($2000) 24,240 7 7 1.00

Total 51,169 60 125

RESULTS

Acres Grown and Harvested

Information on Florida sod production by grass type is shown graphically in Figure 1. Moredetailed information is presented in Table 2 on total sod acreage, farm size, soil type and grassvarieties. Using the appropriate expansion factors, total sod produced in Florida in 2000 wasestimated to be 79,820 acres. Of this total, 65 percent (52,222 acres) was comprised of St.Augustinegrass, 23 percent (18,078 acres) constituted bahiagrass, bermudagrass represented 6percent (4,556 acres), while centipedegrass followed at four percent (2,962 acres) and area ofzoysiagrass was 2 percent (1,538 acres). This information suggests that St. Augustinegrass,although still very important, has lost some ground in the last four years since previous resultsindicated that in 1996 St. Augustine accounted for 72 percent of grass types grown (Haydu, et.al., 1998). Additionally, bahiagrass production more than doubled in the last four years. Thisincrease in bahiagrass production may be primarily due to the construction of new roads and therefurbishment of existing roads and highways by Florida’s Department of Transportation. Bahiagrass is useful as a roadside cover because it is highly drought tolerant, requires littlemaintenance and, with its deep root system, offers effective erosion control.

A farm size analysis is also presented in Table 2. All farms were grouped into four sizecategories based on acres in production and are defined as follows:

C Small = 0–499 acresC Medium = 500–999 acresC Large = 1,000–1,999 acresC Very large = $2,000 acres

Firms comprising the two largest farm size categories generated the majority of industry output— nearly 60 percent of all sod produced. Farms in the largest category comprised 30 percent ofthe total with the second largest group constituting 29 percent. Stated differently, the largest 18percent of firms produced nearly three-fifths of total industry output. Medium-sized growerscontributed another 20 percent and the smallest growers supplied 21 percent of statewideproduction.

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Figure 1. Types of grasses grown in Florida — shown as a percent oftotal production.

How has the distribution of grass varieties changed within farm size categories over the pastfour years? For the smallest farms, the share of St. Augustinegrass in production rose from 52percent in 1996 to 65 percent in 2000. Bahiagrass also became more prominent, with its shareincreasing from 9 to 15 percent. Bermudagrass declined from 13 to 6 percent, as did centipede byfalling from 24 to 12 percent. Trends for St. Augustinegrass production by medium-sized firmsremained essentially unchanged at roughly 65 percent for both periods. However, production ofbahiagrass grew from zero to 15 percent, while acreage of centipedegrass declined from 15percent to a 6 percent share, and bermudagrass remained more or less unchanged. Firms in thelarge category also experienced changes in the proportions of grass varieties grown. St.Augustinegrass production fell from 83 percent in 1996 to 59 percent in 2000. Conversely,bahiagrass more than doubled from 15 to 33 percent. Finally, the share of St. Augustinegrassgrown by the largest producers also declined, from 82 to 73 percent, whereas production ofbahiagrass increased to nearly one-fourth of the total. Other grass varieties for the two largestcategories of sod producers remained virtually unchanged during the four years. In summary,across all firm sizes, the loss of St. Augustinegrass production was largely replaced by anincrease in bahiagrass production, most likely fueled by a strong demand from Florida’s roadsand highways.

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Table 2. Total expanded acres of sod grown in Florida in the year 2000 — by farm size (small:0–499; medium: 500–999; large: 1,000–1,999; very large: $2,000), soil type (sand vs. muckvs. clay) and grass variety.

Farm size/

Soil type

Acres in production

St. Augustine Bahia Bermuda Centipede Zoysia Other Total Percent

Small 21%

Muck 950 85 0 109 14 0 1,158

Sand 9,884 2,482 960 1,442 300 135 15,203

Clay 184 0 71 414 0 0 669

Subtotal 11,018 2,567 1,031 1,965 314 135 17,030

Medium 20%

Muck 1,631 0 0 0 98 0 1,729

Sand 7,290 2,252 1,714 860 260 179 12,555

Clay 774 7 94 94 3 0 972

Subtotal 10,058 2,262 1,851 997 362 179 15,709

Large 29%

Muck 8,454 373 291 0 142 34 9,294

Sand 5,072 7,116 1,093 0 150 116 13,547

Subtotal 13,526 7,489 1,384 0 292 150 22,841

Very large 30%

Muck 9,580 0 0 0 0 0 9,580

Sand 8,040 5,760 290 0 570 0 14,660

Subtotal 17,620 5,760 290 0 570 0 24,240

Totals

Muck 20,615 458 291 109 254 34 21,761 27%

Sand 30,286 17,610 4,057 2,302 1,280 430 55,965 70%

Clay 1,321 10 208 551 4 0 2,094 3%

Total 52,222 18,078 4,556 2,962 1,538 464 79,820

Percent 65.4% 22.6% 5.7% 3.7% 1.9% 0.6%

Sod is grown on either sand (mineral) soils or “muck” (organic) soils. Of the roughly 80thousand acres, 70 percent was produced on sand with the remainder located on muck (27percent) or clay soils (3 percent). Muck soils are typically found in Florida’s EvergladesAgricultural Area (EAA) that lies below Lake Okeechobee in the very southern part of the state,and the low-lying fields surrounding Lake Apopka in the central region. In terms of acreage, thelarge majority of small- and medium-sized farms were located on sand soils — 89 percent for

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Figure 2. Reported acres of sod production in various regions in Florida in2000.

small farms and 80 percent for medium farms. On the other hand, the share of total productionon sand or muck for the larger two farm sizes was more equally distributed with 59 percent ofsod grown on sand by large farms and 60 percent for very large. Placement of sod farms in thestate was obtained by asking survey respondents to note in which of eight map regions, roughlybased on telephone area codes (combined in some instances), their farms were located. Unex-panded acreage located by this procedure is shown in Figure 2 and suggests that the majority ofproduction is concentrated in southern Florida.

Acres of sod harvested in 2000 by grass type and farm size are presented in Table 3. Theinformation in this table sheds light onto three areas — firm-level efficiencies in production andsales, market conditions impacting demand, and the (total) wholesale value of the industry. First,knowledge of acres harvested is useful for calculating the turnover rate or the relationshipbetween sod sales and sod inventory (the ratio of harvested to produced acres) for a given year. Production efficiency is related to two factors, net area stocked per acre (gross area minus areastaken up by roads, drainage ditches/canals and grass left in ribbons for re-propagation) and theamount sold relative to the amount produced as influenced by market demand. Strictly from atechnical standpoint, net production area per acre should be relatively constant from year-to-year,except during extended periods of high rainfall or drought. The former could impair harvestingactivities and the latter could negatively impact both the supply and demand for sod. Second,market demand also influences quantities harvested in a given year. During periods of strongdemand, the total harvestable area should be harvested and sold. Demand for sod is linked

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closely with housing starts, which is impacted by the general condition of the local and regionaleconomies.

Table 3. Acres of sod harvested in Florida in 2000, by farm size and grass variety.

Farm Size

Acres Harvested

St. Augustine Bahia Bermuda Centipede Zoysia Total

Small 8,551 1,486 580 416 172 11,205

Medium 6,526 1,512 1,539 491 269 10,337

Large 10,373 5,523 954 0 216 17,066

Very large 13,611 950 187 0 417 15,165

Total 39,061 9,471 3,260 907 1,074 53,773

Harvested Percent of Production a 75% 52% 72% 31% 70% 67%

a Total percent of production (67%) is weighted. It was calculated by multiplying the percent ofproduction harvested for each type of grass by the percent of total production planted in thatparticular type of grass [e.g. St. Augustine = .75 of production acreage is harvested × 65.4%of total production acreage (see Table 2) = 49%] and summing the resultant percentages.

New developments constitute roughly three-quarters of Florida’s total sod market (Figure 12). The supply of sod is the other side of the equation affecting demand and price. The greater thedifference between supply and demand, the higher the potential price and the more incentiveproducers have to maximize their turnover rates. In periods of high supply and low demand, theopposite situation would occur. Recall that the demand for sod in 2000 was estimated at 52,923acres, based on housing starts and other factors. The supply of sod was estimated to be 53,773acres, using harvested acres as a proxy (Table 3). Consequently, supply and demand for sodwere fairly closely matched in 2000. Third, because sod must be sold immediately after harvestdue to perishability, acres harvested also represent farm gate sales (producers will not cut theirsod unless a sale has been firmly established) that in turn can be used to estimate the wholesalevalue of the industry. This last item is discussed later in this manuscript.

Since sod requires year-round maintenance and care, farmers should strive to maximizeharvested acres to reduce unit costs and increase profitability. For example, an inability to sellsod that has reached a marketable stage increases expenses through costs imposed by routinemaintenance — such as fertilization, weed and pest control, irrigation and mowing. This isparticularly true for St. Augustinegrass, which is susceptible to root decline (Turgeon, 1985). This root “die-back” adversely affects the visual quality of St. Augustinegrass and, therefore, thegrass is generally not sold until new root growth begins in the spring, implying a 3- to 4-monthdormancy period. Consequently, sound management practices would encourage a timely andthorough harvesting of mature sod fields to avoid unnecessary maintenance costs.

In this study, 67 percent of all sod grown was harvested; however, the percentage of eachgrass type harvested varied widely. Centipedegrass was harvested at the lowest rate, 31 percentof production, while bahiagrass was harvested at 52 percent of production, probably due to thevery dry year for Florida. All farms tend to focus on St. Augustinegrass, which has the highest

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harvest rate (75%) and ranges from 90 percent of total production for very large farms to 61percent of total production for large farms. Zoysiagrass — while only 2 percent of production —is harvested at 70 percent of production acreage and all sizes of farms maintain and harvest it. Perhaps this is because it remains the highest priced grass grown in Florida.

Harvest ratios (Table 4) for various sized farms had a marginally wider spread (63%–75%)than they did four years ago (69%–75%). From conversations with industry leaders, a 75percent harvest rate is considered reasonable from an efficiency standpoint. Only large-sizedfarms were able to achieve a 75 percent harvest ratio in 2000. Very large farms moved from 75percent in 1996 to the lowest harvest ratio (63%) in 2000. One may speculate that, once again,the droughty conditions in Florida contributed to these lower harvest ratios; the survey did notaddress reasons for less harvesting, but several respondents made comments about the drought asa reason for fewer acres harvested in 2000 compared to 1996.

St. Augustinegrass is the most widely used grass in Florida and, consequently, the mosteconomically important for the industry. A varietal breakdown of St. Augustinegrass ispresented as a pie chart in Figure 3. Floratam was the most dominant variety produced in 2000,comprising 79 percent (41,419 acres) of total St. Augustinegrass production. Far down the scale,Palmetto was the second most popular variety representing just 7 percent (3,635), followed byFloralawn with 6 percent (3,061 acres) and Bitterblue with 3 percent (1,701 acres). Theremaining St. Augustinegrass varieties — Raleigh, other, and Delmar — comprised 5 percent,with Raleigh being the only named variety accounting for over 1 percent of the total, as shown inTable 5.

Table 4. Acres of sod planted and harvested in 2000, by farm size and per farm, and ratio of sodharvested to sod planted.

Farm size

Acres planted in 2000 Acres harvested in 2000Acres harvested/

Acres plantedTotal Per farm Total Per farm

Small 17,030 218 11,205 144 66%

Medium 15,709 628 10,337 413 66%

Large 22,841 1,523 17,066 1,138 75%

Very large 24,240 3,463 15,165 2,166 63%

Average 639 430 67%

An interesting question is why Floratam continues to hold such a commanding grip on themarket? Are other varieties that much inferior? In a recent market study of sod buyers (develop-ers, landscape firms, sod layers and retail nurseries – unpublished data), respondents stated thatalthough many of the other grasses were good varieties, replacing a “tried and true” product thatwas considered to be an industry standard was unlikely to occur. This reluctance stems from thehigh initial investment absorbed by the buyer (purchase and installation cost) in addition tonumerous risks associated with the landscaping business. For instance, in a new housingdevelopment project, landscaping is the final activity in a long list of tasks — obtaining permits,site preparation, installing water and sewer, constructing roads and building the homes. After all

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Figure 3. Top four St. Augustinegrass types grown in Florida in 2000— shown as a percent of total St. Augustinegrass production. Other includes Raleigh, a mix of other unspecified grasstypes, and Delmar — in descending order of acres inproduction.

this is completed, the landscape operation can begin, which involves land preparation, installingirrigation and drainage systems, and establishing landscape plant material. At the very end, sodinstallation occurs. Given all these activities, it is not hard to understand that cost over-runs anddelays are common. From a producer’s viewpoint, this can make planning extremely difficultand increase the risks associated with switching to other varieties that do not have a provenrecord.

Table 5. St. Augustinegrass production in 2000, presented by farm size and grass varieties.

Farm size

St. Augustinegrass acres in production

Bitterblue Delmar Floralawn Floratam Palmetto Raleigh Other

Small 163 236 91 9,482 554 240 252

Medium 399 0 469 7,356 745 1037 55

Large 785 0 2,501 9,194 830 0 215

Very large 354 0 0 15,387 1,506 0 373

Total 1,701 236 3,061 41,419 3,635 1,277 895

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Sod Prices, Industry Value, Price Determination, and Costs of Production

Sod Prices. Farm gate sod prices received by producers in 2000 are shown in Table 6. Pricesranged from a low 5.8¢ a square foot for bahiagrass to a high of 24.9¢ a square foot for zoysia-grass. The price of St. Augustinegrass was in the middle of this range at 14.6¢ per square foot.

Table 6. Sod farm acreage, percent harvested, price per square foot, and unweighted harvestvalue in Florida in 2000 — by major grass variety.

Turfgrass varieties

Total acresin

productionPercent of production

acres harvested Averageprice/ft2

Harvest value a

$ millions

St. Augustine 52,222 75% $0.146 $249.1

Bahia 18,078 52% $0.058 $23.8

Centipede 2,962 31% $0.160 $6.4

Bermuda 4,556 72% $0.114 $16.3

Zoysia 1,538 70% $0.249 $11.7

Total 79,356 $307.2

a Harvest value, assumes percent of gross production acres sold based on results of this study, calculated as {(production acres × percent area harvested) × (43,560 ft2 × price/ft2)}.

Industry Value. Prices were used to calculate the value of the sod industry in 2000. Harvestvalue, the quantities actually sold in 2000, were estimated at $307 million. This value places sodwell within the top-ten agricultural commodities in Florida. Eighty-one percent of harvest valuewas attributable to St. Augustinegrass ($249 million), the same share as in 1996. However, since1996 bahiagrass ($24 million) has replaced bermudagrass as the second most valuable sodcommodity, and zoysiagrass ($12 million), with four percent of the market has moved into fourthplace in front of centipedegrass ($6 million), which holds only a two percent share of the market.

Price Determination. Given the price differentials across varieties, one might expectproducers to concentrate on the highest-priced grasses as seems to be the case with zoysiagrassand its advance in market share. However, why produce so little zoysiagrass when its unit valueexceeds St. Augustinegrass by nearly 70 percent? One answer has to do with supply anddemand, and potential market share. From the demand side of the equation, St. Augustinegrasshas been the preferred grass for home lawns, which constitute 75 percent of all turfgrass used inFlorida (Figure 12; Hodges et al., 1994). St. Augustinegrass, and particularly Floratam, hasdominated the market because it provides value to consumers in terms of desirable productattributes. Some useful attributes of a good turfgrass include visual attractiveness, goodrecuperative potential, a certain degree of utility — conserving the soil, allowing infiltration of water and filtering of pollutants — and easy maintenance. Regarding the latter, an ideal turfgrasswould: entail little mowing and not be hard on equipment, require minimal irrigation and

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fertilization, be resistant to pests and diseases, not be too invasive, and be tolerant to cold andheat stresses. Although St. Augustinegrass is not a perfect variety, it has provided these featuresmore consistently over time than other grasses, hence it has succeeded in preserving its “marketshare”. Producers will naturally be drawn to the grass that is easiest to sell while still providing areasonable and steady profit.

On the supply side of the equation, yield, costs and profitability are the critical variables. Grass varieties differ in yields, but yield effects on profitability can be offset by other factors. The interval of sod production is from harvest-to-harvest. A fast-growing grass such asbermudagrass has high variable costs due to the extensive use of inputs (fertilizer, pesticides,mowing, etc.) over a short time frame. At least two harvests of common bermudagrass areachievable within a year, as opposed to one for St. Augustinegrass. The interval of sod produc-tion also affects fixed costs (e.g., land, buildings, and overhead or administrative costs). Generally speaking, shorter production periods imply greater yields per unit time, implyingfurther that fixed costs on a yield basis (square feet or yards) will be reduced. Exceptionalspecies, such as zoysiagrass, that generally require more intensive management — zoysiagrass ismore susceptible to pest and disease problems than St. Augustinegrass — over long productionintervals (typically 1.5 years or more), will generally be more expensive to produce. Hence, priceis only one aspect regarding the economic feasibility of sod production. Pest and diseasesusceptibility also make it less desirable for homeowners who prefer low-maintenance grasses.

Earlier it was noted that the supply of sod (relative to demand) also impacts prices. Anunder-supply of sod (relative to demand) would imply higher prices while an over-supply wouldsuggest lower prices. Although this research did not explicitly attempt to determine therelationship between supply and demand for Florida sod in 2000, rough estimates can beobtained. Recall in the introduction that the University of Florida’s BEBR ascertained that therewere 157.1 thousand single and multi-family housing starts in 2000. From this, it was estimatedthat 43,775 acres of sod would be needed to serve this market. An additional 25 percent of sodfrom other market outlets, such as golf courses, commercial and non-profit institutions, and there-sodding market for existing homes (Figure 12 of this report), brought total annual demand in2000 to 54,719 acres statewide.

The supply of sod can be estimated using harvested acres as a close approximation. FromTable 3, this figure was determined to be 53,773 acres. Comparing this figure with demand, it isapparent that both supply and demand were matched quite closely in 2000. When supply anddemand are equal, economic theory suggests that an “equilibrium point” has been reached. Equilibrium is a situation in which supply and demand are in balance. At an equilibrium price,the quantity demanded by individuals is exactly equal to that which is supplied by all firms(Nicholson, 1985). However, at the time of this writing (early May 2002), market prices for mostvarieties have fallen modestly from their high in 2000, indicating that supply may currently beexceeding demand.

This observation is supported by the survey when respondents were asked to comment onfuture production levels. Over half (50%) of all producers expect to increase sod acreage, 47percent indicated they would maintain current levels of production, and the remaining 3 percentsaid they would reduce their acreage. The intention of so many producers to increase productionlevels indicates they are still optimistic about future demand. Although the price of St.Augustinegrass increased only from 13¢/ft2 in 1996 to 15¢/ft2 in 2000, this followed a steady rise

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Figure 4. Percentage of total costs per acre attributable tospecific sod growing and selling activities (initial sitepreparation such as stump removal, ditchconstruction, pump installation, etc. are not included).

from 8¢ in 1992. All other major grass varieties have also seen a price increase from 1996 to2000 — zoysiagrass increased from 18¢ to 25¢; centipedegrass increased from 10¢ to 16¢; andbahiagrass also rose 1¢ from 4 years ago (from 5¢ to 6¢) — with the exception of bermudagrass. Bermudagrass, whose price increased by one-third from 9¢ to 12¢ from 1992 to 1996, remainedabout the same with an average price of 11¢ in 2000. Interestingly, mediums-sized farms, whichproduced the most bermudagrass (40% of total) in 2000, had the lowest average price for it whileall other farm sizes charged above the average price per square foot.

Costs of Growing and Selling Sod. A newly included section of the survey attempted to betterunderstand costs of being in the sod business, without asking producers to spend extensive timereviewing financial records. In order to do so, respondents were asked to estimate the percentageof total costs per acre that are attributable to various growing- and marketing-related activities(Figure 4). Principal costs associated with these activities include materials, labor and equip-ment. Growth activities accounted for 65 percent of total costs and include land preparation (11percent), fumigation (5 percent), planting (10 percent) and production (39 percent). Productionactivities are the largest share because they represent on-going work that begins after plantingand continues until harvest, a period of 6–12 months, depending on the grass variety. Principaltasks would consist of fertilization, pest and weed control, mowing (Figure 5) and irrigation.

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Figure 5. Sod mower with a 36-foot swath.

Figure 6. Sod harvester cuttingrolls for landscape use.

As defined in this report, marketing activities accounted for the remaining 35 percent andinclude harvesting, sales/marketing, and freight. At nearly one-quarter (23 percent) of totalexpenses, harvesting comprised two-thirds of the “after-growth” costs. Harvesting involves theuse of expensive equipment (Figure 6) and considerable labor and does not occur until the salehas been made. Sales and marketing also included collections of accounts receivables andaveraged 7 percent of total costs; freight constituted the remaining 5 percent.

Finally, producers were asked how they determine the price they charge for their product(Figure 7). They were given 3 choices plus an open-ended “other” category and asked to rankeach selection in order of importance. A first-choice ranking was given four points, second placeranking received three points, third place was two points and fourth choice was scored as onepoint; then total number of points for each choice by all respondents was added to determine the‘weight’ assigned to that choice. Interestingly, the majority of producers (48%) indicated the“selling price of other producers” as the principal pricing method (total weight ranking of 185). “Cost of production” was ranked first by 37 percent of producers (weighted at 148); “quality ofmy sod” was classified first by 17 percent of growers (weighted at 144), and the “current marketsituation/demand” was written in as the most important pricing strategy by 10 percent of therespondents. Second, third and fourth round rankings are also shown in the stacked bar. Giventhese results, it is apparent that sod producers use several inter-related methods to arrive at pricesfor their product.

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Figure 7. Considerations made by Florida sod producers whendetermining the selling price of sod.

Components of Farm Income

Although most (74%) income was generated by sod sales, the same percentage as growersresponding in the 1996 survey, and 47 percent of respondents claimed it as their sole source ofincome, roughly one-fourth of earned income was from related or alternative agriculturalbusiness activities (Figure 8). Food production (cattle, citrus, dairy and vegetables) was the mostimportant (14%) income alternative, a significant increase from five percent in 1996. Sod-relatedservices accounted for nine percent of income, a drop from 18 percent in 1996. These activitiesincluded shipping (3%), landscape contract services (4%), and other miscellaneous services suchas installation and plug/sprig activities (3%). Ornamentals production declined from threepercent in 1996 to one percent of income in 2000, while an “others” category that included landleasing and sales of silage feed, pine straw and eggs remained the same at just over 1 percent.

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Figure 8. Partitioning of farm income by Florida sod producers in 2000. (Data not weighted by farm size.)

Marketing — Harvesting and Brokering

Just-in-time harvesting of Florida’s sod coincides with the high growth periods, which alsofacilitates sod reestablishment in the landscape. Still, compared to more northern states, theharvesting pattern for Florida sod is rather uniform throughout the year. Twenty-nine percent ofthe harvest occurs during the March to May period, 26 percent takes place from June to August,25 percent is harvested September through November and from December to February, Florida’sdrier winter season, 20 percent is harvested (Figure 9). This pattern is consistent with that of thebuilding construction industry, which experiences peak activity during the spring-through-summer interval. As noted earlier, the bulk of sod is used for landscaping new developments,including residential homes, business offices and government facilities.

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Figure 9. Seasonal harvesting pattern of Florida sod in 2000.

Most Florida sod producers (80%) still choose to harvest their own sod rather than contract-ing to outside firms, although the percentage dropped from 89 percent four years ago. Nearly allsod (84%) is strip cut as it was in 1996, while the remainder (generally bahiagrass and bermuda-grass) is clear cut. With strip-cut sod, harvesting machines remove sections that are roughly 16-inches wide, ideally leaving only a two-inch ribbon of grass between them for reestablishmentfrom stolons. Efficient producers try to remove only ¼ to ½ inch of root zone when cutting sodsince thinner pieces are easier to handle, less expensive to transport, and tend to knit-in (producea thatch) quicker than thicker cut sod (McCarty and Cisar, 1989). Removing only the amount ofroot zone needed for survival of the sod also leaves the producer’s field in better shape byreducing topsoil loss. Bermudagrass producers often clear-cut a field because it reestablishesfrom rhizomes as well as from stolons. According to survey respondents, they harvestedapproximately 76 percent of each acre of St. Augustinegrass, 84 percent of each acre of bermuda-grass and 75 percent of each acre of centipedegrass, leaving the remaining sod for regeneration oflater crops. This percentage, an average of 78 percent, remains consistent with findings in 1996.

To generate additional income or satisfy demand when their own production is inadequate,some producers brokered sod. Traditionally brokers do not purchase the inventory, nor do theyget involved in financing or assume risk. The chief function of a broker is simply to bring buyersand sellers together and to assist in negotiation. One-fifth (20%) of all producers indicated theybrokered some sod. The average quantity brokered in 2000 was 3.9 million square feet, over 2.5times the average brokered in 1996, with a value of $248 thousand.

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Marketing — Shipping

Seventy percent of harvested sod is machine-stacked as opposed to hand-stacked. However,some of the largest producers prefer to use large teams of manual labor for stacking sod. Theirreasoning is that, for large-scale operations, current farm equipment is not cost-effective — largelabor teams can stack and move sod more quickly than most automatic harvesters (Cisar andHaydu, 1991). In addition, labor often offers more working flexibility. Since many workers areseasonal, the farm does not incur so high an annualized cost of production as it does withautomatic harvesters. Purchased machinery becomes part of a firm’s fixed costs; thus, evenwhen the equipment is not in use, the owner is still paying for it. On the other hand, growers canemploy seasonal labor, as a variable cost of production, only when needed.

Once sod is cut and stacked, nearly 100 percent of it is shipped to its destination within 2days. This is due to the highly perishable nature of cut-sod. The vulnerability of sod may alsoexplain the relatively high incidence of truck ownership — forty-four percent of respondentsindicated that they own their own transportation equipment. Regardless of the fact that roughlyhalf of the respondents own transportation equipment, nearly half of those responding indicatedthat obtaining trucks for sod delivery at the time they were needed was sometimes a problem. Although the information was not requested in the survey, scheduling difficulties would likelyarise during the peak selling months of spring and summer when transport demand is high forother agricultural products as well.

Figure 10. Sod pieces stacked on a pallet consisting of 500 square feet. Sod pallet being pickedup to load on a truck. A truck loaded with sod ready for shipping. (Left to right)

Distance to markets is a critical factor for producers to consider. Sod is a heavy, bulky itemthat requires prompt attention. These factors greatly impact the potential risk to both buyer andseller. The more distant the markets, the more expensive sod is to ship and the greater thepotential for post-harvest losses. Consequently, producers located close to key markets have aclear strategic advantage over producers located farther away. Survey respondents reported that55 percent of their markets are within 50 miles and another 31 percent of the markets arebetween 50 and 100 miles away. In other words, most growers were positioned only a few hoursfrom the majority of their markets. Eighty percent of the growers also reported that their marketswere staying approximately the same distance away from them. Nearly three-quarters of theremaining growers’ markets were moving closer and the other growers’ markets were movingfarther away. Figure 11 depicts sod sales in Florida and clearly reflects the development ‘hotspots’ in the state. The figure also highlights the in-state nature of the sod market in Floridasince only 3 percent of sales were reported as being shipped out of Florida.

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Figure 11. Distribution of sod sales throughout Florida and the average percent oftheir total sales for all growers who sell sod in specific regions.

New developments accounted for three-quarters (75%) of Florida’s sod sales in 2000 andanother 21 percent of sales were for re-sodding existing developments, demonstrating theprincipal linkage between Florida’s population growth and the turfgrass industry (Figure 12). The distribution of buyers is also presented in Figure 12. Ten percent of sales were made tohomeowners, 56 percent to landscape contractors and 17 percent were made to bro-kers/wholesalers. Golf courses, retail garden centers and others (listed as Florida’s Departmentof Transportation, building contractors, used by self, sold to individuals or sold on site andinformation unavailable) each purchased about 6 percent of the sod sold. In 1996, most growers(78%) were optimistic about future conditions and believed that the market for sod in their areawould continue to expand. Indeed, in 2000 fifty-two percent of growers responded that there hadbeen an increased market for sod in their area since 1996 and 44 percent anticipated that themarket in their area would continue to increase. Forty-one percent of growers expressed that themarket had stayed the same in their area since 1996 and 30 percent felt that it would continue toremain about the same. Although only four percent felt that there had been a decline in the sodmarket in their area in the last four years, 26 percent expected the market to decrease in their areain the next three years.

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Figure 12. Depiction of how Florida sod was utilized (left) and to whom sodproducers sold their product (right) in 2000.

Sod Quality

Although turfgrass quality is difficult to measure, Beard (1973) states that characteristics ofhigh quality turfgrass have been established over the years. The six basic components ofturfgrass quality he identifies are: uniformity, density, texture, growth habit, smoothness andcolor. Beard notes that the relative importance of these features will vary according to thepurpose for which the turf is to be used.

In a more general sense, turfgrass quality can be affected at any one (or all) of five majorstages — turfgrass breeding, which determines the inherent physical characteristics of thevariety; production and cultural practices employed by the grower; harvesting and stacking;shipping and unloading; and after the buyer receives it. In this study, we were interested infactors other than physical properties. In particular, from the producer’s perspective, was qualitycompromised at some point on the farm, or after the product was sold and delivered? Addition-ally, if damage did occur prior to receipt by the buyer, at what stage(s) did it take place (duringproduction, during harvesting and stacking, or during shipping and unloading)?

Although no aspect of the sod production/sales cycle is without potential quality-reducingdamage, in 1996 growers believed that half of the damage occurred to sod after the buyerreceived it, leaving an opportunity for the growers/shippers to improve sod quality for about half

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the damaged product. In 2000, growers responded that 45 percent of the damage to sod occurredafter the buyer received it and that one-quarter of the damage (25%) occurred in the fieldcompared to 19 percent in-field damage in 1996. This increase in the in-the-field damage mayreflect the production problems related to very droughty conditions experienced in much ofFlorida in 2000. Damage occurring previous to the buyer’s receiving it through harvesting andstacking decreased from that in 1996 (from 19% to 14%) and shipping and unloading damageincreased in 2000 to 16 percent compared to 12 percent in 1996. These results indicate that bothproducers and consumers are responsible for reducing turf quality. But more importantly, itsuggests that because growers (by their own admission) cause more than half of all damage to theturfgrass they sell, significant room for improvement still exists. Astute growers can distinguishthemselves in a competitive market by addressing some of these quality-compromising issues.

Employment, Mechanization and Farm Expenses

As farms become larger in response to increasing pressures to reduce production costs,agriculture continues to shift towards greater mechanization. This is due to the fact that labor inagriculture normally accounts for a significant share of total cash expenses. This share can varyfrom 15 to 30 percent, depending on the size of firm and type of commodity being produced(USDA/ERS, 1997). Mechanical devices in agriculture are generally designed for specificfunctions and for specific crops. For example, wheat harvesters cannot be used for corn andtomato harvesters cannot be used for cotton. Additionally, this specialized equipment is alsovery expensive. To reduce capital costs per unit of output, large-scale farms emphasize mono-cultural production systems that can efficiently use this specialized equipment.

Labor tends to be much more versatile than machinery and is used for more complex tasks. Hence, labor use per acre will be significantly less for a large wheat farm than for a smaller farmproducing small amounts of diversified products. Since it is a monocultural crop, one wouldanticipate that there would be a significant substitution of capital for labor in sod production. Interestingly, this is not the case. Results of this study indicate that labor remains a criticalresource in Florida’s sod production industry. When asked whether labor use had changed in thepast four years, 29 percent reported that the number of people they employ had increased, whilethe number of employees had remained the same for 60 percent of respondents, and 11 percentsaid that labor use had decreased (Table 7).

Unlike fruit and vegetable producers who employ large numbers of seasonal workers, sodfarms have year-round production and maintenance activities and rely on permanent labor.Seventy-eight percent of the 2,410 employees on Florida’s sod farms were full-time in 2000 withan average of 20 persons per farm (Hodges and Haydu, 2002). Eighty-three part-time workerswere employed by 16 of the 60 reporting firms, an average of 5.19 part-timers for each firm withpart-time help. However, seventeen firms, almost triple the number of firms in 1996, reportedthe use of seasonal labor. This seasonal labor totaled 250 people, nearly an eleven-fold increasesince the last study. In terms of farm size, the use of permanent labor ranged from a low of 8.0persons for small farms to a high of 67 employees for the very largest farms. The largestproducers were also the only group to indicate they did not employ any part-time help, althoughthey did hire some seasonal employees, which they did not do four years earlier.

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Table 7. Full-time, part-time and seasonal employment figures for various-sized sod farms in2000 and changes in employment numbers compared to four years ago.

Farm size

Average number of workers employed Change from 4 years ago

Full-time Part-time Seasonal Increase No change Decrease

Small 8.0 1.8 5.2 23% 63% 13%

Medium 20.8 1.8 0.9 30% 60% 10%

Large 28.4 0.2 2.0 38% 50% 13%

Very Large 66.7 0.0 7.4 43% 57% 0%

Average 20.1 1.4 4.2 29% 60% 11%

To obtain a more complete picture of the substitution of capital for labor, a question wasasked whether the level of mechanization had changed over the past four years. One-third of allsurveyed firms indicated their farms were more mechanized now, while the remaining two-thirdsstated that the level of mechanization had not changed (Table 8). There appears to be littledifference attributable directly to farm size, based on the variability that exists across size classes. However, four years ago the medium-sized farms reported the smallest increase in mechanizationand this time 50 percent of them reported the use of more mechanization. No respondentreported a decrease in mechanization in 2000.

Changes in operating expenses were also examined (Table 9). Nearly all producers (87%) affirmed that costs had grown over the past four years with an average increase of 21 percent,about 5 percent annually. In 1996, 90 percent of growers said that costs had increased; theaverage increase at that time was also 21 percent for a five-year period, or a little more than 4percent annually. In 2000, the largest cost increases were reported for the medium-sized farmgroup — at 50 percent or 12.5 percent annually. The smallest change in 2000, as in 1996,occurred with the largest farms which experienced a 13 percent rise in the past four years. Fivepercent of all farms reported a cost decrease with the average amount being 13 percent over fouryears.

Table 8. Changes in mechanization on various-sized sod farms in 2000 compared to four yearsearlier.

Farm size

Mechanization on farm since 4 yrs. ago

Increased No change Decreased

Small 28% 72% 0%

Medium 50% 50% 0%

Large 14% 86% 0%

Very Large 43% 57% 0%

Average 33% 67% 0%

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Table 9. Changes in operating expenses of various-sized sod farms in 2000 compared to fouryears earlier.

Farm size

Operating expense change from 4 yrs. ago

Percent ofgrowers with

cost increase

Averageamount of

cost increase

Percent ofgrowers with

no costchange

Percent ofgrowers withcost decrease

Averageamount of

cost decrease

Small 87% 22% 7% 7% 10%

Medium 80% 50% 10% 10% 15%

Large 100% 16% 0% 0% n.a.

Very Large 86% 13% 14% 0% n.a.

Average 87% 21% 7% 5% 13%

Firm and Industry Problems

In this last section of the survey, producers were asked to identify the three most seriousproblems they face from an individual business standpoint, as well as the three most challengingproblems from an industry standpoint. Results were then grouped into categories that wererepresentative of the types of answers. Five broad areas affecting individual businesses wereidentified as financial, production-related, regulatory, personnel and marketing (Figure 13). Ofthese five, clearly the most prominent (a weight of 110) related to financial concerns such as fueland insurance costs, excessive labor costs, prohibitive equipment costs, fly-by-night competitionand taxes. This was also the primary concern regarding individual businesses of growers fouryears ago. Production considerations were second (weight of 64) followed closely by marketingand economic concerns (weight of 62). Typical production issues were weeds, mole crickets andinsects, weather and maintenance of sod in the field. Marketing or economic concerns jumpedsignificantly from fifth-ranked four years ago to nearly tied for second place in 2000. Somemarketing or economic problems listed were distribution/delivery problems, availability ofproduct, answering questions and educating the public and government, and reliable service suchas on-time delivery and loading of delivery trucks when they arrive. With a weight of 53,personnel-related issues were ranked fourth. These involved problems like deficient productionskills of workers and their inability to hire enough employees with a legal status. Regulatorytype concerns, ranked last with a weight of 33, falling markedly from its “tied-for-second”position four years ago. Regulatory issues included the loss of methyl bromide, water restrictionsat the receiving end and dealing with government agencies.

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Figure 13. Weighted responses of survey participants when asked about thethree most important problems faced by the respondent’sbusiness. Most important problem counted as 3 points, secondmost important problem was weighted as 2 points and the thirdmost important problem was given 1 point.

The five categories identified for firms are the same as the industry because of the inter-related nature of the issues; however, their rankings differ from those of individual businessconcerns (Figure 14). Surprisingly, although individual business concerns changed positions inthe ranking from four years ago, industry concerns maintained almost the same ranks withregulatory moving into a first-place tie with production issues. The weights did change howeverand rankings were much closer for the top three areas of concern. Following production andregulatory concerns (weighted at 69 each) were financial (very close with a weight of 67),marketing (weighted at 51) and personnel problems (weighted at 25). A few industry-relatedissues not expressed from the firm perspective included the taxing of the aquifer, the quality ofsod, and the need for a drought-resistant grass from a production standpoint. Regulatoryconcerns included water issues, and financial concerns mentioned included vagabond buyersrunning up credit. Marketing concerns at the industry level included the strength of the economywhile personnel issues at the industry level included labor availability.

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Figure 14. Weighted responses of survey participants when asked about thethree most important problems facing the sod industry. Mostimportant problem counted as 3 points, second most importantproblem was weighted as 2 points and the third most importantproblem was given 1 point.

SUMMARY

Roughly 125 producers comprised Florida’s sod production industry in 2000 producing anestimated 80,000 acres of sod and harvesting nearly 54,000. This figure is fairly consistent withdemand for sod that was determined to be in the neighborhood of 55,000 acres. Of the totalquantity produced, 70 percent was grown on sand-based soils while 27 percent was produced onmuck soils, particularly around Lake Okeechobee. St. Augustinegrass accounted for 65 percentof total production, followed by bahiagrass (23 percent), bermudagrass (6 percent), centipede-grass (4 percent) and a nearly insignificant amount of zoysiagrass (2%). In terms of St.Augustinegrass, Floratam dominated all grass varieties.

Florida sod producers harvested and sold the majority of the grass grown, varying from a lowof 31 percent for centipedegrass to a high of 75 percent for St. Augustinegrass. Sod pricesreceived were consistently strong, ranging from nearly 6 cents per square foot for bahiagrass to25 cents for zoysiagrass with St. Augustinegrass holding the middle ground at almost 15 centsper square foot. Using these prices in conjunction with harvest figures, the study estimated thefarm gate value of sod at just over $300 million in 2000, maintaining its place as a majoragricultural commodity in Florida.

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Although sod utilizes numerous market outlets, most (75 percent) was sold to the newhousing market, 21 percent was targeted for re-establishing existing home lawns, and theremaining went for “other uses”. To handle all the various tasks related to the production andselling of sod, the industry uses substantial labor. The average sod farm employed nearly 20 full-time, one part-time and four seasonal workers. This number represented an employment increasefor 29 percent of the farms compared to four years ago and “no change” for 60 percent of thefarms.

Finally, producers identified several problems that affected business performance. The mostsignificant problems for individual businesses were financial-related issues such as fuel andinsurance costs, dishonest businesses and excessive labor costs. An ability to acquire adequate“legalized” labor was also cited as a difficulty. Problems facing the industry as a whole wereperceived to be production-related (quality of sod and the need for a drought- resistant sod) andregulatory-related (mainly water issues), followed closely by financial issues (such as vagabondbuyers running up credit).

REFERENCES

Beard, James B. 1973. Turfgrass Science and Culture, Prentice-Hall, Inc., Englewood Cliffs,N.J.

Bureau of Economic and Business Research. 2001. 2000 Florida Statistical Abstract, ThirtiethEdition. Susan S. Floyd, Ed. University of Florida.

Cisar, J.L. and J.J. Haydu. 1991. Adjustments in market channels and labor in the Florida sodindustry. Journal of Agribusiness 9(2): 33–40.

Haydu, J.J. and J.L. Cisar. 1992. An economic and agronomic profile of Florida’s turfgrass sodindustry. Economics Report ER92-1, Food & Res. Econ. Dept, IFAS, UF.

Haydu, J.J., L. N. Satterthwaite and J.L. Cisar. 1998. An economic and agronomic profile ofFlorida’s sod industry in 1996. Economic Information Report EI 98-7, Food & Res. Econ.Dept, IFAS, UF.

Hodges, A.W. and J.J. Haydu. 2002. Economic impacts of the Florida environmental horticultureindustry, 2000. Economic Information Report EI 02-3, Food & Res. Econ. Dept, IFAS, UF.

Hodges, A.W., J.J. Haydu, P.J. van Blokland, and A.P. Bell. 1994. Contribution of the turfgrassindustry to Florida’s economy, 1991–92: A value-added approach. Economics Report ER94-1, Food & Res. Econ. Dept. IFAS, UF.

McCarty and J.L. Cisar. 1989. Basic Guidelines for Sod Production in Florida. Florida Coop.Ext. Serv., Bulletin 260, IFAS, UF.

Nicholson, Walter. 1985. Microeconomic Theory: Basic Principles and Extensions. ThirdEdition, The Dryden Press, Chicago, IL.

Turgeon, A. J. 1985. Turfgrass Management. Reston Publishing Co., Reston VA.

USDA/ERS. 1997. Financial Performance of U.S. Commercial Farms, 1991–94. AgriculturalEconomic Report Number 751.